Force mines to pay a living wage

14 November 2012, 15:06

Many believe that if the mines had paid a living wage, the recent violent strikes could have been averted. I have researched this issue and come up with some very interesting facts. These facts and figures are in my opinion correct, and are not the figures often given by readers, based purely on hearsay and urban legend. As a contractor who regularly works on the mines, I recently had a discussion with a black supervisor at one of Angloplats mines. He informed me that rock drill operators were considered to be the least skilled workers on the mine, and occupied the bottom rung of employees.

As in any Corporate, rare and crucial skills are the best remunerated. As rock drillers can be trained up in such a short period, and applications for these positions far outweigh the positions available, normal supply and demand factors come into play. Most mines operate on the Paterson Job Classification scales, which rates an employee according to the skills he brings to the organisation, and his contribution to planning, profitability as well as competent management of processes. This is a fair system, as it applies equally to all mine employees.

The supervisor also categorically informed me that the rock drillers earned a minimum gross salary of R10 000 per month, not the R4000 bandied around by the strikers. He informed me that with production and merit bonuses, it was easy to increase the salary to R15 000 per month. On top of this, miners who chose not to live in free mine accommodation, also offering free meals, were given a compensation of R1600 per month extra. On top of this they get free world class medical facilities, well run free education, and first class soccer / sports stadiums etc. Statements are always made as to the appalling squatter camp conditions these unfortunates have to live in.

Recently at Angloplats Amandelbult mine, I passed one of these so called inhuman squatter camps. Although constructed of corrugated iron, the houses were solidly built, with extended verandas, offering full protection from the elements. These squatter camps were very clean and well kept, with the outside area swept daily with grass brooms, trees planted, with each houses situated on a sizeable piece of land ( ie not one houses squashed against another).

The only squalor observed, was the inhabitants practise of dumping all their domestic waste, slops and uneaten food, directly opposite the camp, and on the other side of the main road passing the camp. These stinking rubbish piles were full of scavenging dogs, goats, chickens, pigs and cows, and obviously swarms of blue bottle flies. It would appear that the inhabitants had chosen to dump this stinking rubbish where they did, rather than go to the effort of digging deep rubbish pits, which could be covered with soil when full. And to answer the obvious question, yes, I would be perfectly happy to live in such a camp (minus the rubbish piles of course), if I simply could not afford any alternative accommodation. The striking miners initially demanded R12 500 salary after deductions, but those still on strike later increased their salary demand to R 16 500, in pocket after all deductions.

They also strongly objected to having to pay tax, as this reduced their salary too much. Considering conservative figure of 25% deductions due to tax, UIF, pensions etc., this would indicate that the R16 500 + 1600 housing allowance would relate to a gross salary demand of R 22 625 per month, for an unskilled , semi educated worker, in low demand. Other articles have stated that the Australian miner at the rock face, earns a huge salary of A$ 600 per month. This figure is ludicrous, as the actual figure is A$ 6500 per month. Academic geniuses’ than multiply this figure by the R – A$ exchange rate, which gives a figure of R 56 875 per month. Using the false 4 000 per month figure bandied around by the strikers, they than state that Australian Rock Face miners earn 14.5 times more than their South African counterparts. Let us now discuss the “GEARY KHAMIS DOLLAR- INTERNATIONAL DOLLAR”.

This is a hypothetical unit of currency that has the same purchasing power as compared with the American dollar. It is based on the twin concept of purchasing power parities ( PPP ) and the international average price of commodities. It shows what a local currency unit is worth within a countries borders. It is used to make comparisons between local currencies, both between countries, and over time. Using these formulas, the present salary of an Australian miner at the rock face reduces to R 27 000 per month. In assessing this salary, one must consider that the Australian miner is 70% more productive than his American counterpart, due to the use of innovative, unique, and mechanised mining methods. Their staff quota on their mines is miniscule compared to the mining labour force in South Africa. The ratio then of the salaries between SA and Australia, now reduces from 14.5 times to 2.3 times. Current minimum wages in SA are around R1200 per month. This means that the strikers earn about 10 times above the minimum wage. In Australia the minimum wage is A$ 2425.

These miners therefore earn 2.7 times above the countries minimum wage. The other favourite argument for a living wage, is the very dangerous and unpleasant conditions the miners have to work under, and yet they are so poorly paid. Let us look at statistics. Last year 123 miners were killed in the entire mining industry. Considering the number of miners employed, this relates to 0.18 miners per 1000 miners. Road death toll for 2011 was 14 000 people. Murder rate was 16 000 people. Natural deaths accounted for 600 000 people. An estimated 5.5 million people are HIV positive. As for the terrible working conditions, platinum is generally mined within the depth range of 400 - 900m below surface. The temperature at the rock face increases according to a geothermal gradient of 10 centigrade, for every 1000m increase in depth. At 400m this related to an increase in temperature of 5 degrees, increasing to approximately 10 degrees at 900m depth. Extensive refrigeration plants and ventilation systems, reduces the air temperature in the working areas to completely normal. The high power ventilation systems clean the air up to a very high safety standard. All underground workings are very well lit.

While working at Angloplats Amandelbult mine, I passed a housing estate for black supervisors and middle level managers. The houses were all built by the mine, and offered free to their employees. They comprised well-built, face brick, three bedroom homes, complete with garage, perimeter fencing, air conditioning, and even DSTV dishes.

The roads were all tarred. Shops and a school were also present in the village. If rock drillers are so discontent with their wages, why don’t they improve their education and skills, move up on the Paterson scale, and the same benefits will then accrue to them. If the mines buckle in to the unreasonably high salary demands of the strikers, this will have the immediate knock on effect of reducing the number of new employees that can be hired. Higher wage costs will inevitably result in the closure of all marginal mines. These strikes could not have occurred at a better time, when mineral exports are severely depressed by the current world financial crises. Many of the major mining corporations have been reporting running at a loss under the present economic climate. 3

A personal experience to understand the logic of the strikers, was that contractors have been ordered to not resume work at certain mines, due to the threat of attack by strikers. I asked a black security manager why they would want to attack an outside, private contractor, busy with a major capital project to improve the platinum extraction process, thereby significantly increasing the mines profitability. His answer to me was that the strikers were very angry with contractors, as they were being paid whilst the strikers were not. They reasoned that the contactors were stealing the money which should rightfully be reserved for them. So I again ask the question, is it completely true that the present striking miners are not being paid a reasonable living wage.

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